WASHINGTON–The Defense Credit Union Council (DCUC) and America’s Credit Unions sent several letters to Capitol Hill ahead of a number of hearings.

In its  letter to the Senate Health, Education, Labor & Pensions Committee ahead of a hearing on Linda McMahon’s nomination as Secretary of Education, DCUC Chief Advocacy Officer Jason Stverak emphasized the Department of Education’s role in financial education, student lending, and service member protections—”issues central to DCUC’s mission and the financial well-being of those who serve our country.”

The Recommendations

In the letter, DCUC made the following key recommendations:

• Enhancing Financial Literacy
• Partner with credit unions to integrate financial education into schools, especially in military communities
• Expand digital financial resources and promote DoD-endorsed literacy programs
• Streamline Public Service Loan Forgiveness (PSLF) for service members and expand eligibility for military families.
• Improve oversight of loan servicers to prevent misinformation.
• Reduce regulatory barriers and allow credit unions to offer student loan refinancing
• Ensure fair policies that support credit unions as key financial educators
• Protecting Military Families from Predatory Lending
• Strengthen oversight of deceptive lending practices targeting service members.
• Collaborate with consumer protection agencies to enhance borrower protections.

Case Study

In its letter, DCUC’s letter cited what it calls aa supportive case study, sharing how since 2017 Redstone FCU has launched student-run branches in eight high schools and three colleges, providing financial literacy, work experience, and scholarships. The program has awarded $52,000 in scholarships and generated over $742,000 for schools through specialized debit cards.

Letter Ahead of Chavez-DeRemer Hearing
Separately, DCUC sent a letter to the Senate Health, Education, Labor & Pensions Committee ahead of a hearing on the nomination of Lori Chavez-DeRemer for Secretary of Labor.

In its letter, DCUC called for consideration of the impact of labor policies on defense credit unions and their ability to serve military and veteran members. ​

Issues Addressed

DCUC’s letter outlined the following issues and offered the following comment:

• Proposed increases to the salary threshold for overtime exemptions could impose significant burdens on smaller credit unions serving military installations, potentially reducing services and staffing. DCUC recommended a phased-in approach with exemptions for small, defense-focused credit unions to preserve essential financial services.
• Changes to fiduciary duties under the Employee Retirement Income Security Act (ERISA) could increase compliance costs and divert resources from member services. DCUC advocated for regulatory relief to maintain flexibility for credit unions managing retirement plans and military transition assistance.
• As defense credit unions operate on military bases under the “one bank, one credit union” policy, increased unionization efforts and National Labor Relations Board (NLRB) regulations could hinder hiring and retention. DCUC requests that credit unions serving military personnel be exempt from unionization mandates affecting commercial entities
• Defense credit unions are uniquely positioned to provide financial counseling and services to transitioning military members. DCUC recommends stronger partnerships between the Department of Labor (DOL) and credit unions to enhance financial readiness and workforce training for military families and veterans.
• The DOL’s ongoing rulemaking on worker classification may limit credit unions’ use of independent contractors, raising costs and reducing service availability. DCUC advocates for maintaining flexibility in classification standards for credit unions.

America’s CUs Weighs In

Ahead of the Senate Small Business Committee’s hearing on managing risk in the Small Business Administration (SBA), America’s Credit Unions President/CEO Jim Nussle wrote a letter describing credit unions’ perspective on measures impacting risk related to SBA’s 7(a) Loan Program.

As ACU noted, loans made under the 7(a) program can be up to 85% guaranteed by the government, with the guaranteed portion not counting against the credit union member business lending cap of 12.25% of assets.

“One of the best ways the SBA can manage risk is expanding and improving its work with its regulated financial institution lending partners such as credit unions,” Nussle wrote as he explained the need for expanding credit union participation in SBA lending programs. “While credit unions are eager to grow their SBA loan portfolios, many report that the administrative burden makes it extremely difficult to do so. Lack of internal expertise and high costs associated with participation remain significant barriers.”

Streamlining SBA loan processes would be “a game-changer” for credit unions and the small businesses they serve.

Fintechs & Risks

Nussle also wrote on the importance of safeguarding SBA programs from risks introduced by fintechs:

“The rise of fintech lenders in SBA programs has brought both opportunities and challenges. While fintechs have demonstrated an ability to leverage technology to reach new markets, their participation in SBA initiatives has raised serious concerns about program integrity,” he explained. “To address these concerns, we urge the SBA to adopt stringent safeguards for fintech participation in its programs. This includes enhanced initial vetting, continuous monitoring, and requirements for compliance with the same regulatory standards that are applied to depository institutions.”

ACU noted credit unions continue to oppose initiatives to allow the SBA to become a direct lender, which was also outlined in the letter.

Mike Sims, chief commercial banking officer at Georgia’s Own Credit Union, testified on behalf of America’s Credit Unions before the House Small Business Committee on ways the SBA can help credit unions serve more small businesses.

Letter on Digital Assets

Separately, ahead of a hearing on digital assets, Nussle wrote to the Digital Assets Subcommittee saying, “The credit union movement recognizes the growing need for digital asset services and advocates for policies that allow credit unions to responsibly offer these services while safeguarding member interests. Key priorities include securing custodial authority for stablecoins, ensuring compatibility with credit union structures, and addressing uncertainties around reserve deposits and rehypothecation.”

In the letter, Nussle noted that America’s Credit Unions supports the framework in the Guiding and Establishing National Innovation for U.S. Stablecoins (GENIUS) Act (S. 394), which properly identifies the appropriate subsidiary entity for a credit union as a credit union service organization (CUSO). The House’s discussion draft of its stablecoin legislation does so as well.

Additional Asks

The letter also asks Congress to:

• Consider limiting the role of foreign deposits and foreign central bank money as categories of reserves
• State clearly that credit unions are authorized to perform all the activities listed as “incidental powers” in Section 13 of the GENIUS Act respectively as incidental powers.